Carlsbad's Big Bertha Bombs

San Diego  By definition, an avid golfer is one who, horrified to learn that his sister has become a hooker, frantically phones her and shouts, "Think of the family reputation! Try widening your stance! Soften your grip! Ask the pro shop if your clubs are too long!"

There is also a statistical definition of an avid golfer: one who plays at least 25 rounds a year. Avid golfers make up only 23 percent of the nation's 26.2 million players, but they account for 63 percent of the $4.5 billion spent annually on golf equipment and the $19.5 billion shelled out in fees.

That's important to San Diego County, because Carlsbad is the golf-equipment capital of the U.S. Seven years ago, with Tiger Woods bursting onto the scene, the industry was expanding rapidly, expecting a bonanza when baby boomers took to the links in the 2001­2005 period.

But here it is, the week of the 2004 U.S. Open in Southampton, New York, and golf has not taken off. TV ratings are up, but participation is down slightly. Golf is expensive, and soft economies around the world have dampened its growth.

Beginning in the mid-1990s, golfing-equipment manufacturers came up with all kinds of aerospace-based equipment using exotic metals. Carlsbad's Callaway Golf Co., the industry kingpin, was even getting $600 for one of its drivers, the Biggest Big Bertha. But golfers won't pay that much anymore, particularly since the new clubs have not come through as advertised.

From a societal perspective, golf may be an anachronism for our quick-gratification, violence-loving culture. Golf is a cerebral game in a dumbed-down world. "It is intimidating, a difficult game," says Larry Dorman, senior vice president of Callaway.

Playing 18 holes takes four or five hours. And it requires continuous practice. Golf is suffering the same fate as 19th-century composer Richard Wagner, who wrote operas that last more than four hours, not counting intermissions. Wagner, like golf, requires a long attention span.

According to the National Golf Foundation, 55 percent of U.S. golf facilities recorded a decline in rounds played last year. It was 61 percent in 2002. The number of rounds dropped 3 percent in 2002 and 1.5 percent last year. And those figures may be optimistic. According to Golf Datatech, the number of rounds dropped 2.6 percent last year.

In the mid-1990s, the golf industry went on a course-building binge. It ended with failures and bankruptcies, including some in golf-crazed San Diego.

In 1997, Callaway's Big Bertha clubs sold heavily. Two other Carlsbad companies -- TaylorMade (a division of Germany's Adidas) and Cobra (a division of Illinois-based Fortune Brands) -- chased Callaway by coming up with their own oversized clubs using sexy metals such as titanium and tungsten. Callaway shelled out a stiff $130 million for Carlsbad-based Odyssey, which dominates the putter industry. New golf courses were springing up everywhere, and the industry was finally giving attention to inner-city youth: it looked as if golf would no longer be an aristocrat's game.

But 1998 brought El Niño, the collapse of the Japanese leisure market, and stiff price competition. Golfers balked at $500 price tags for one club. Then came layoffs. Golf-equipment employment in the county began to drop from its peak of 5500. Today's figures are hard to come by, but Cheryl Mason of the California Employment Development Department thinks there may now be a bit fewer than 3500 working in golf-equipment manufacturing here, although Callaway alone has 2300.

Back in 1998, "Callaway had successfully raised prices on new products," says Bud Leedom of Comstock Investment Advisors, who once had a golf investment newsletter. Then came "a huge upswelling of consumer skepticism -- whether or not clubs were doing as much as the companies said." (Leedom says the new clubs get greater distance, but he questions that they improve accuracy; that is, hookers -- and slicers -- still abound on golf courses.) With prices falling, retailers got overstocked and into financial difficulty. "Callaway destroyed inventory rather than sell it off at cheap prices," says Leedom.

The exotic metals started dropping away. "Titanium is still a strong part of the golf market," says Leedom. "It's very lightweight and durable, permitting the making of larger heads." But tungsten lost its glitter, along with liquid metals and alloys created at Caltech.

The U.S. Golf Association cracked down on Callaway's ERC II driver, because of its "springlike effect -- the ball came off the club too hot and went too far," says Dorman. There was genuine concern that the new clubs would make existing courses obsolete. They would have to be lengthened -- not easy, given urban real estate prices. Callaway (and TaylorMade and Cobra, which had similar clubs) lost the battle. The ERC II "sells mainly in Europe and Japan, where it won't be banned until 2008."

The club makers argued that the new clubs would attract more people to the game and get fewer elderly people to quit. Historically, four million people had taken up the game each year, and another four million had abandoned it. Maybe futuristic technology would mean fewer clubs hurled in the water or broken over knees. But the industry lost. Now, four million people take up the game each year, but a little more than that quit.

The industry also found that teaching inner-city kids to play wasn't creating that many more players. "The problem is follow-through. We need public courses where they can afford to play," says Dorman.

Now, the industry is promoting quickie nine-hole games. Some are thinking of five-hole rounds for folks in a hurry, but such a strategy would have to overcome centuries of tradition.

With prices lower, the companies are trying to broaden their markets. Callaway spent $200 million to develop a premium ball. It has gained consumer acceptance but is a money drain. So the company bought the assets of bankrupt Top-Flite, a maker of cheap balls. The move has met with skepticism.

"The market is basically saturated for the new types of clubs, the Big Berthas and their successors," says David N. Allen of Palomar Equity Research. "After a decade of exceptional demand based on technological developments, we're back to a normal environment. There is a core group of golfers that will always buy the latest technology if it will improve their game by subtracting a stroke from their score. The industry is stable but doesn't offer significant growth prospects."